User pain may be eased by EMC realignment

24.10.2006

EMC also expects to lay off about 1,250 employees as it consolidates and streamlines its many lines of business. VMware will not be included in that reorganization, a spokesman said.

While the Hopkinton, Mass-based company wasn't specific about the areas in which the business process streamlining will take place, Chief Financial Officer David Goulden said during the earnings call that the reorganization will focus on management, non-customer-facing positions, such as those in human resources and finance, and non-core research and development positions.

Part of the reason for the company's reticence in revealing details is that EMC employees were hearing about the layoffs for the first time during the conference call, said CEO Joe Tucci, who added that the company was not likely to make any additional major acquisitions for a while.

EMC also plans to announce more products like its information life cycle management software, Infoscape, which is made up of components acquired through purchases of several different companies, Tucci said. While Tucci said one future area of focus would be security, and that initiative will be based on technologies acquired in the company's purchases of RSA Data Security Inc. and Network Intelligence Corp.

Mike Fisch, an analyst at The Clipper Group Inc. in Wellesley, Mass., said the layoffs, which amount to about 4 percent of the company's 31,000 employees, represent an organizational fine-tuning as opposed to something bigger.